At a property auction, what happens if bidding does not reach the reserve price?
Correct Answer
C) The property is passed in and may be sold by private negotiation afterwards.
When bidding fails to reach the reserve price, the property is 'passed in' and the auctioneer may negotiate privately with interested bidders after the auction. The vendor is not obligated to sell below the reserve price.
Why This Is the Correct Answer
If bidding stops below the reserve, the property is passed in and no sale occurs. The agent can then negotiate privately with the bidders and other interested buyers on the vendor's instructions.
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- → An agent in NSW quotes a property at $800,000-$850,000 but sets the reserve at $900,000. Three weeks later, the agent receives feedback that most buyers are interested at $820,000-$840,000. What should the agent do to comply with underquoting legislation?
- → In NSW, a buyer signs a private treaty contract for an established home and changes their mind two days later. When can they withdraw, and at what cost?
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- → A married couple intend to bid together at a NSW residential auction to buy the house jointly. What registration is required?
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During an auction, the auctioneer makes a bid on the vendor's behalf. What is this called, and when is it lawful?
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